Baku, Azerbaijan, August 28
By Leman Zeynalova – Trend:
Unless there is a gas supply and purchase contract in place, it would be premature to argue that Israeli Leviathan gas will go to Egypt or Turkey, Sohbet Karbuz, Director of Hydrocarbons, Mediterranean Energy Observatory (OME), France told Trend.
Intentions, wishes and desires can be very different from commercial realities. At the end it is the commercial realities that will define the direction of exports from the Leviathan project, he added.
“Whether the Israeli gas will flow into the TANAP-TAP will not affect the profitability of those pipelines as their final investment decisions are made without relying on the gas from Israel. At the end, commercial and market realities will determine where the Leviathan gas will go,” noted Karbuz.
Earlier, it was reported that Royal Dutch Shell Plc is in talks to buy natural gas from Israel’s Leviathan field, combine it with output from Cyprus’s Aphrodite field, in which it owns a 35 percent stake, and pump it to a liquefied natural gas plant in Egypt.
Israeli Minister of National Infrastructures, Energy and Water Resources Yuval Steinitz said during the 22nd World Petroleum Congress in Istanbul that Turkey and Israel intend to sign an agreement on construction of a gas pipeline to Europe by late 2017.
“We are confident that in the future, Europe will buy gas produced in the Eastern Mediterranean. Currently, intensive talks are underway on building two pipelines. We plan to build one of them to Turkey and further to Europe. Another pipeline is planned to be constructed through South Cyprus and Greece to Italy,” said the minister.
Karbuz noted that Southern Gas Corridor aims to bring Caspian, Central Asian, Middle Eastern and East Mediterranean gas into European markets.
“So, in fact bringing gas from Israel to Europe either through Turkey or through Greece is part of the Southern Gas Corridor concept. The intention is to improve Europe’s gas supply security through diversification,” he added.
The partners on Israeli Leviathan gas field have approved the development plan for the field with a target production date for late 2019.
The development plan envisages production of about 12 billion cubic meters of gas a year at a cost of $3.5-4 billion, according to the report.
The Israeli partners in Leviathan include Delek Drilling and Avner Oil, each with a 22.67 percent stake, and Ratio Oil with a 15 percent stake. Moreover, Noble Energy Mediterranean Ltd has a 39.66-percent stake in the project.
The Southern Gas Corridor is one of the priority energy projects for the EU. It envisages the transportation of gas from the Caspian region to the European countries through Georgia and Turkey.
At the initial stage, the gas to be produced as part of the Stage 2 of development of Azerbaijan's Shah Deniz field is considered as the main source for the Southern Gas Corridor projects. Other sources can also connect to this project at a later stage.
As part of the Stage 2 of the Shah Deniz development, the gas will be exported to Turkey and European markets by expanding the South Caucasus Pipeline and the construction of Trans Anatolian Natural Gas Pipeline and Trans Adriatic Pipeline.
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